Analysis provided by Ashton Fraser, learn more about his Forex Reversals trading strategies.
The Litecoin bulls have been exhausted for the meantime, will the bears take over?
Let’s take a look at the LTC/USD hourly chart below (click to expand):
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I’ve done the Fibonacci study from the low at 10.7 to yesterday’s high at 14.8. Since then, we can see how price has been hovering along the 23.6% Fibonacci retracement level at around 13.8, (circled in blue).
Looking at the technical indicators, we can see how the Stochastics (10,6,6), are almost oversold, and price is touching the lower Bollinger line, plus the Accelerator Oscillator has just turned green. This gives more credence to the resistance of the 23.6% Fib level, which could hold for a few more hours.
However, zooming out to a higher timeframe, namely H4, we can see that there’s a bearish setup forming. Click on chart below to expand.
Look at how the Stochastics have just crossed over bearing down, and both the Awesome and the Accelerator Oscillator have turned red. In addition, the white trendline I have drawn shows some pretty strong resistance forming. So even if the 23.6& Fib level held for a while, I doubt it will be able to hold next week, unless the trend line breaks, in which case we’ll see some major bulls.